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Image: Caterpillar.

Heavy-equipment maker Caterpillar (NYSE:CAT) has seen its sales plunge due to global weakness in the industries that it serves, but the company is working hard to find ways to bounce back and promote future growth. In November, Caterpillar executives Michael DeWalt and Richard Moore presented at the Goldman Sachs 2015 Industrials Conference and talked about some of the key initiatives that Caterpillar is following in order to improve on its recent poor performance. Here are five specific things that they said that every Caterpillar investor needs to know.

"One of the real positives for us over the last three or four years is we have done a really good job in managing material cost."

Caterpillar has had to work hard to cut its expenses wherever it can, and a big part of the savings the equipment-maker has found is in managing the costs of its materials. With commodity prices having fallen, that might not seem all that surprising, but DeWalt noted that it relies on highly engineered parts that aren't as sensitive to changes in raw-material prices. The executive said that Caterpillar's supplier-management team has done well to control costs and work with suppliers to improve efficiency, and that's been critical in keeping the company as healthy as possible.

"We started the year with a pretty high oil and gas backlog, and that's been coming down all year."

The plunge in oil prices has rocked the energy industry, and that has led Caterpillar customers in that space to cut back on future orders, hurting backlog figures. DeWalt sees that dynamic continuing for the foreseeable future, and that has added to pressure from weak construction levels in Latin America and China. Caterpillar now believes that it has set its future views appropriately to reflect the sluggishness in energy, and going forward, any improvement in oil prices should help bolster the equipment-maker's own expectations.

"We're in a lot better shape than we were at the last [cyclical] bottom."

Caterpillar saw cyclical weakness in 2009, which is when oil was last at current levels, but things recovered in 2010. DeWalt noted that Caterpillar's balance sheet is stronger than it was back then, with the company's finance arm having gotten itself into much better shape. The executive also pointed out that when conditions started to turn, the growth Caterpillar enjoyed was explosive, with sales up 40% in 2011. Few investors are prepared for just how good the good times can be after a down cycle, but Caterpillar is poised to take advantage when it comes.

"I don't think there are many places in the world today where there's an opportunity to push price, and that certainly wouldn't be at all in our plans."

Pricing is a key component of any business, and some investors hope that Caterpillar can eventually boost the prices of its equipment in order to improve sales and profits. Yet DeWalt threw cold water on the idea that we were anywhere near that kind of pricing environment, pointing to weakness in mining, energy, and construction. Moreover, the strong dollar has already made pricing a challenge in most foreign markets, putting further pressure on Caterpillar's ability to grow its business. For now, DeWalt doesn't see a market that could support higher pricing.

"By and large, miners have not taken out capacity, have not really cut production much, and you see that in commodity prices being lower. ... At some point, that will have to run its course."

Both Caterpillar and peer Joy Global (NYSE:JOY) have taken big hits from the poor commodities markets, with Joy Global's coal-mining focus dealing an especially hard blow to its business. DeWalt has noted that outside of coal, few miners have taken the tough steps necessary to adapt to low commodity prices. Instead, they've cannibalized equipment for parts in an attempt to keep at least some machines running longer rather than making new purchases. DeWalt notes that eventually, mining companies won't be able to turn to older machines and will instead have to start refreshing their capital budgets. When that happens, Caterpillar expects that it will see a huge surge in sales, and it hopes that its efforts to cut costs will put it in a better competitive position than Joy Global in the areas in which they compete.

Caterpillar has a tough road ahead of it, and there's only so much it can do while it waits for economic conditions to improve in most of its key markets. Nevertheless, investors should be optimistic that Caterpillar is taking the necessary steps to take advantage of the next cyclical upturn whenever it comes.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.